From an overseas investor perspective. India continues to look very positive: Sanjay Sachdev, Zyfin Holdings

In a chat with ET Now, Sanjay Sachdev, Executive Chairman, Zyfin Holdings, says the direct impact of growth is first seen on financials and that is the reason why there is a much more larger allocation from a financial standpoint. Edited excerpts


ET Now: Let us talk about the Nifty first. Some important cues that all the investors were waiting for. First, the Bank of Japan deciding to holding on to interest rates and also in terms of expectations from the Fed’s move. What is your call?

Sanjay Sachdev: In India, we are sitting in a very sweet spot globally as you know and in fact what we have seen even from Japan with their decision to hold rates. Yields are extremely poor if not negative in most countries especially in the developing world and the developed world. So India sits on the other end of the spectrum and rates are relatively high and there is a good opportunity to lock in these rates and also take advantage of the price pick up. From an overseas investor perspective. India continues to look very positive and probably one of the best places to invest across the board.

ET Now: I am just looking at the fund that you manage -- the Zyfin MSCI India Fund and it is interesting to note that your largest exposure after financials is with the IT sector. Given the kind of voices that we heard from the IT pack and some of the leaders thereof, the likes of TCS which is talked about, a fatigue in the BFSI segment and then Infosys where most believe that they are going to set out a profit warning and cut their guidance as well and then of course the problem persist across the midcap IT space as well. Are you revisiting this thought on Indian IT or is your fund a long term one so these near term aberrations do not quite matter?

Sanjay Sachdev: Well the MSCI India is a benchmark for almost 90% of the global investors who invest in India and the index portfolio composition is really more of a global composition which is structured by MSCI and it really takes into account global growth and India’s positioning in terms of its sectoral growth across different sectors over a long term period. So it is not something that gets focused on just the next three months or so.

From that standpoint, I totally agree with you it is really a more a long term oriented fund but besides that I think the MSCI India the beauty about this is that this is the first time that global investors that institutions especially who have mandates that they cannot invest through structured notes or through derivative structures until now the MSCI India in Europe specifically was available only through structured mechanism and starting tomorrow we are listing this on the London Stock Exchange and this will be available now where the underlying will be actual stocks of the Indian market.

ET Now: I can see that you have a big largecap exposure but what about the midcap IT of Indian stocks because that is the one which has really made money and been profitable on a year to date basis?

Sanjay Sachdev: Well the composition of the index is not specific to largecap or midcap, it is really specific sectors which are the drivers of the Indian economy and if you look at what are the key drivers that drive GDP growth. The MSCI India is very well placed to address that.

ET Now: Also just taking a look at your fund where the interest on the financials looks quite intriguing 19.12% what makes the sector so attractive?

Sanjay Sachdev: Well traditionally if you look at any economy the financials sector is a precursor to the growth in the economy because they are the ones that benefit, the fastest and you can see that growth much more easily comparatively so as you see GDP growth rates the first the direct impact you see is really on the financials and that is the reason why there is a much more larger allocation from a financial standpoint.